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Debt and Divorce in Minnesota

September 22, 2015

Minnesota Divorce and DebtOne of the most difficult and complex issues when negotiating terms for a divorce is debt settlement and division of property. Individuals may have very deep feelings and different expectations of how this should be handled. Minnesota law is pretty clear about property and debt allocation in divorces, so it may be helpful to be familiar with the general guidelines as you embark on this process. Here are some important things to note:

  • In the state of Minnesota, any property that is gained by either spouse during the marriage is presumed by the state to be marital property. This applies to salary, other earnings, pensions, retirement investments and other property acquired during the marriage. The court views a marriage as full partnership and equates the contributions of a spouse who might stay at home as equal in value to the spouse that brings in the majority of the income. As a result, generally speaking, you can expect that that marital property and debts will be split in half in a divorce.
  • In a divorce non-marital property is not split 50/50 like that of marital property. Since non-marital property is given to one spouse or another either prior to the marriage or as a gift/inheritance by a third party to one of the spouses but not the other, then it remains the property of that spouse after a divorce.
  • When it comes to debt, Minnesota courts generally include debts accrued in marriage on the same sheet as the property and assets, so that the total when considering both assets and debt is divided evenly between the two parties. One potential caveat to that is debt that is accrued by one spouse without the knowledge of the other (think gambling or illegal drugs). But, just because one spouse has more control over the household finances than the other (and may be more aware of specific debts), do not assume this will be viewed the same way.

Johnson Mediation: Minnesota Divorce Mediation Services

One very effective way to manage the division of property and debt during a divorce is to use a divorce mediator. The court system is fairly rigid and can cost you a significant amount of time and money. Johnson Mediation provides divorce mediation to those all over the state of Minnesota, including Chanhassen, Eden Prairie, Chaska, Minnetonka, and Wayzata.

Our team can help walk you through the process to divide property, build individual budgets for your separate futures, and develop workable parenting plans. Your agreements are all accurately summarized into a Memorandum of Agreement that is used to complete all the necessary legal documents for your divorce. Divorce mediation allows you to get the help that you need to navigate the difficult process of divorce without surrendering control to the court system. Give us a call at 1-952-401-7599 to schedule a free consultation.

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